Michael Jimenez, Realtor
IPO Fever & Pacifica, CA Real Estate
By now I'm sure you've heard all the buzz about Uber, Lyft, Slack, Postmates, Pinterest and Airbnb potentially going public this year.
The New York Times published this article, and this one, noting how several big tech companies in San Francisco going public will have a major impact in the local housing market. Fortune also reported here that "San Francisco is about to see an increase in millionaire residents as multiple high tech start-ups become public companies, which is adding further pressure on the city’s limited affordable housing."
HERE'S MY TAKE
If you're in the market to buy a home this year, it's not necessarily the tidal wave of new buyers at some unknown date that you need to worry about, what's happening in the meantime is what you need to pay attention to. Seller expectations are shifting the market now.
DON'T LET THE MARKET GET AWAY FROM YOU
Seller's who don't have to sell right now, and can wait a bit to put their home on the market, will sit on the sidelines until they think that they can get a premium for their home -- when the IPO's hit and the onslaught of new wealth increases competition and drives up home prices.
So, if you are looking to buy this year, try to do it sooner than later since the IPO talk is already impacting inventory levels and at the very least keeping pricing stable in some neighborhoods, or slowly driving it back up in others, from where we saw a small dip during the "cool down" the media buzzed about late last year.
WHAT DOES THIS MEAN FOR PACIFICA, CA REAL ESTATE
Tight inventory and increased pricing isn't only applicable to homes in San Francisco, Pacifica will be impacted too.
Sure, San Francisco is the epicenter, but surrounding cities also feel the impact. As inventory constraints drive up home prices in San Francisco more buyers will look to move out of the City and into neighboring cities like Pacifica. With some commute times to SF under 20 minutes, and with BART so close by, Pacifica is a natural choice for many SF buyers who will get priced out of their primary market or realize they can get more for their money on the coast.
THE BOTTOM LINE
If you're in the market for a home this year, now is a good time to buy for two reasons:
1. The closer the IPO pop off frenzy becomes, the tighter inventory will become as sellers who can wait, will wait to put their homes on the market in hopes of achieving a premium price through increased competition in the market, thereby causing tighter and tighter inventory levels as we get closer to the IPO pop.
2. Interest rates are still low! Take advantage of that. Remember, when interest rates start to climb again you start to lose purchasing power. That loss in purchasing power combined with tight inventory and increased competition will either 1) result in you paying a higher price for your home due to increased competition and multiple offer scenarios or, 2) price you out of the market.
Have more questions about this, or the Pacifica, CA real estate market in general? Send me an email: firstname.lastname@example.org | text/call me: (650) 898-8869. I look forward it!
Michael Jimenez | Selling Specialist | lic #01961866
The Krishnan Team | Compass | lic #01443761 call or text: (650) 898-8869
Compass is a licensed real estate broker and abides by Equal Housing Opportunity laws. All material presented herein is intended for informational purposes only. Information is compiled from sources deemed reliable but is subject to errors, omissions, changes in price, condition, sale, or withdrawal without notice. No statement is made as to the accuracy of any description. All measurements and square footages are approximate. This is not intended to solicit property already listed. Nothing herein shall be construed as legal, accounting or other professional advice outside the realm of real estate brokerage. BRE #01443761
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